27th March 2020
The Government has now issued guidance to home buyers/sellers with regard to transactions that might complete during the period of the coronavirus outbreak. With immediate effect, we will be adopting these recommendations while continuing to ensure that we do everything we can to protect the health of our clients, staff and the public.
The overriding advice from the Government is that, due to the uncertainties and health concerns that result from the virus, that all parties to a residential sale should ‘adapt and be flexible to alter their usual processes’. The Government has confirmed that there is no need to pull out of a transaction, but it is expected that all concerned will follow all guidance and advice on social distancing and self-isolating. The Government has also confirmed that critical home moves are exempt from the new enforcement powers granted to police.
The specific advice the Government offers is as follows;
- If a property being sold is vacant then the transaction may be completed as long as any move/removals can be safely undertaken (see later).
- Where contracts are already exchanged, then it is advised that parties should work together ‘to agree where possible, a delay or another way to resolve this matter’ or ‘include explicit contractual provisions to take account of the risks presented by the virus’. Where a delay cannot be agreed for contractual reasons then in completing the transaction ‘people must follow advice on staying away from others to minimise the spread of the virus’.
- The Government is working with lenders to ensure that mortgage offers can be extended where completions are delayed due to the current crisis. It is anticipated that lenders will offer a three month extension to buyers who have exchanged but agree to delay completion.
- If a property is under offer, the conveyancing may be progressed. Where the transaction is ready to exchange, it may proceed on the basis that the property is empty and any move can be safely undertaken (see later). For occupied properties, parties should only consider exchanging contracts if they can make explicit provision for the risks presented by the virus.
- If a property is listed for sale but not under offer, then marketing and advertising may continue, however in-person viewings should not be conducted. Virtual viewings are acceptable.
- The Government has also provided advice to removal firms stating that they should honour existing commitments where the move can be managed safely for the client and the removal team. Where removal firms do continue to provide services, they must act in accordance with the Governments guidance on working in people’s homes – see further information here: https://www.aspireresidential.co.uk/news/landlords/110-covid-19-landlord-update
- Notwithstanding the above, if anyone involved in a transaction has symptoms, is self-isolating or shielding from the virus, they should not move house. All parties to the transaction (including parties at other points in a chain) should be accommodating to the need to delay the transaction under such circumstances.
This is a rapidly changing situation. We will continue to post updates to our website and communicate directly with clients as matters evolve.
24th March 2020
Like everyone else, the team at Aspire Residential has been monitoring the development and spread of the Coronavirus pandemic. As a responsible Company, we have implemented appropriate measures to help prevent the spread of the virus and safeguard the health of our clients, staff and the general public. This is a rapidly evolving situation and our guidance below is valid as of today’s date. We will continue to publish further updates as we learn more and receive further guidance from the Government and regulatory bodies.
In accordance with Government guidance, our office is now closed until further notice and our key staff have adopted a 'work from home' policy. Staff have full access to systems and files to allow them to continue to perform essential activities and services for clients while adhering to current advice on social distancing.
On the back of Brexit and a General Election, up until mid-March 2020, data from Rightmove suggested that the housing market was performing well, with asking prices reaching an all-time high and agreed sales for this time of year achieving the best volume since 2016. Sadly, all of that has changed over recent days as we try to come to terms with the reality of dealing with a global pandemic and the country essentially going into ‘lock down’.
Based on current information, in our view, while the Coronavirus is likely to reduce short term transaction volume, it is unlikely to impact selling prices. When viewings resume, we expect sellers to benefit from considerable ‘pent up’ demand, especially as we move into the peak selling seasons of spring and early summer. A reduction in interest rates should also help stimulate the market and we anticipate a strong response from buyers when normal trading conditions resume.
Sales and purchases ‘subject to contract’
As at today’s date, the Government has not issued any guidance for transactions that are subject to contract and which are expected to complete over the coming weeks or months. The Conveyancing Association is advising members to deal with matters on a case-by-case basis while ensuring members act in accordance with the government’s restrictions.
Given the current uncertainty, it is possible that we will face some unique challenges in progressing the sale. This is where as an agent, we need to be proactive and ensure that sensible decisions are being made. It is inevitable that both parties will have incurred costs and they will not want these to be wasted. Fundamentally sellers still want to sell and buyers want to buy, we just need to find the most creative and safest way for the transaction to move forward should it remain in the best interests of both parties for it to do so. Some necessary changes to the conveyancing process that you might experience over the short term include;
- It is possible that sales and purchase contracts will incorporate specific clauses to deal with the challenges introduced by the Coronavirus. Where this is the case, we will work with your conveyancing firm/solicitors to ensure these are reasonable and make sense for all parties.
- Over the coming weeks we ask that you are patient, as it is inevitable that land registry, solicitors, mortgage brokers and lenders implement their own contingency plans and manage through potential staff shortages. This will inevitably slow transactions down.
- The Home Owners Association and a number of the solicitors that we work with are recommending that, to deal with some of the uncertainties introduced by the virus that, where possible, exchange and completion should take place on the same day. This is to eliminate the complication of either party becoming ill after exchange and therefore being unable to complete and being in breach of contract.
- Ahead of any completion that does take place, vendors should ensure that they are able to arrange for a physical move to take place on the agreed date. The British Association of Removers (BAR) continues to issue guidance to its members and we suggest that you stay abreast of this advice. You should ensure that you act in accordance with Government advice at all times.
Listings which are currently unsold
We will be acting in accordance with Government advice with regard to property viewings. The Ministry for Housing, Communities and Local Government (MHCLG) has advised that agencies should close their offices as they are not deemed to be ‘essential services’. We have acted accordingly. MHCLG has further advised that in-person viewings should not take place. As such, we will not be conducting any further physical/face-to-face viewings until we are advised by the Government that it is safe and appropriate to do so.
We will continue to take enquiries from potential buyers and answer questions that they might have. We will also continue to actively market your property. If buyers wish to perform a ‘virtual’ viewing, we will make arrangements with you to conduct a skype or facetime call whereby the potential buyer can be shown the key attributes of your home.
We recommend that vendors use their time at home to make minor repairs to their property and ensure that their homes present in the best possible light when viewings can be resumed.
If you are considering selling, we encourage you to give us a call. We would be happy to give you a free market assessment and undertake a desktop valuation of your property. We would also encourage you to use the time to get your property ready for sale and ensure that you have all of your financing and other administrative matters in order.
Now is an ideal time to start planning for the months ahead and the potential pent up demand we discussed earlier in this article. As we noted, we do not expect the current turmoil to adversely impact property values and we anticipate that recent interest cuts should create a stronger rebound.
Based on what we can learn about your property we would consider doing a ‘soft launch’ by reaching out to our database on known buyers to ensure that we can create some early excitement when your property is eventually offered to the market.
We recognise that this is a difficult time and we want you to be assured that we are doing everything in our power to continue to provide exceptional service, while acting to protect the health and wellness of our staff, clients and the general public. This is a rapidly evolving situation and we will continue to publish further updates as we learn more and receive further guidance from the Government.
Thank you for your understanding
Director - Aspire Residential Sales